An Unsecured Bond Is Called a

question 34

Multiple Choice

An unsecured bond is called a

• A)debenture bond
• B)mortgage bond
• C)registered bond
• D)serial bond

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Definitions:

CAPM

Capital Asset Pricing Model; a formula used to determine the expected return on an investment, factoring in its risk relative to the market.

Risk-to-reward Ratio

A measure used by investors to compare the expected returns of an investment to the amount of risk undertaken to capture these returns.

Constant

A fixed value that does not change in mathematical equations or in the context of specific calculations.

Security Market Line

A line that represents the relationship between the expected return of a market security and its risk, as measured by beta.